Gregory J. Heym
Executive Vice President, Chief Economist
"Hats Off To My Ol' Homestead!"
I hate to say this, because I grew up in Manhattan, but are the residents of this respectable urban enclave on crack?? I’m busy reporting these nasty numbers of double digit price dips in the major metropolitan markets of our great U.S. of A.--the LA’s, Miami’s and Washington, DC's--and then I get this report from the exalted bean-counters at Halstead Property of NYC.
“Average Sale Price For Manhattan Apartments Set New Record, Reaching $1,300,212.” How’s that for a headline! Not to mention that the median price (half above, half below) also hit a new high of $840,000. Those are up 7% and 11% respectively from a year ago. Condo prices are up 28% from last year, all sizes included. The average sale price of a co-op was down a bit, but that’s due to an 8% decline in the size of the co-ops sold. Why? Because there’s no inventory!!! All the big ones are taken.
And that’s what the folks at Halstead said. Manhattan has just so much space, and building permits on the island are actually down because there’s simply nowhere to put anything. Inventories on the upper West Side (a.k.a. young family-land) of 4+ bedroom apartments are down 24% from last year. A low crime rate and improving schools, they say, are drawing families back into the city.
Well I get the crime rate thing, but I don’t think anyone paying NYC prices is going to be sending their kid to public school, and the number of horror stories of NYC private school competition is soaring right along with the co-op prices and sales.
Here’s one of my fave numbers from the report: The median price per room of a co-op on 5th Avenue, uptown of course, was $522,222 in the second quarter of this year. And trust me, the rooms aren’t that big. Okay, so that’s 5th Avenue, you say, but try Central Park West, it’s even higher at $550,000 per room. The greatest price gains were seen in the larger apartments, three and four bedroom units, with 17% and 36% gains respectively from the same period last year.
The really really big, or “luxury apartments” (are four bedrooms chopped liver?) did see a price hit, down 10% from last year’s record $4 million, but island realtors claim the numbers skew the reality. “Luxury” is defined as the top 10% of the market, and this year saw a wider range of sales due to the surge in overall numbers. I guess there were just so many people buying that apparently “luxury” dipped a bit.
I talked to a sales guy from Halstead, and he claims East and West are all one now, uptown and down the same, no more delineation's of social and price strata. It’s all expensive, and anyone will live anywhere. I don’t buy that, I’m afraid. Prices may be up everywhere, but Manhattan will always be a grid, and I’m not talking about the streets.
Still, I have to say, “Hat’s off to my ol’ homestead!” The island unto itself clearly turns its well-honed nose up at the rest of the nation’s housing market. Oh, and here’s a fun little note: In 1970 my parents bought a classic six on Central Park West for $40,000. About seven years later they sold it, at a loss.
Tuesday, July 03, 2007